Federal Deficit to Hit $2.3 Trillion in 2021, Budget Office Says: Live Updates

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Several federal trust funds, including those for Social Security and the country’s highways, are expected to remain solvent for years longer than expected in September…credit…Lucy Nicholson/Reuters

The federal budget deficit will reach $2.3 trillion in fiscal year 2021 even if Congress does not approve a new bailout plan. That’s down slightly from last year’s $3 trillion, but it remains the second-largest deficit since World War II, according to new projections released Thursday by the Congressional Budget Office.

Nevertheless, the updated projections show an improvement in the government’s budgetary position compared to the Budget Office’s projections of last autumn. The Budget Office estimates that the U.S. economy is now recovering faster than expected, thanks to stimulus programs and the ability of American businesses to adapt to the pandemic.

The projected deficit for 2021 is higher than the agency’s September projections, largely due to the $900 billion in economic assistance that Congress approved in December. However, the projected deficit has continued to narrow in the coming years as the economy has grown faster than expected, resulting in higher tax and other federal revenues.

These projections are likely to prompt President Biden and Democrats in Congress to speed up the approval of a $1.9 trillion bailout package, which includes funds to combat the coronavirus and help ailing families and businesses. Republicans objected to the size of the package, saying it was not worth spending so much on stimulus at this stage and would further increase the federal deficit. But Democrats, preparing to approve as much of the package as possible without Republican support, are likely to use the C.B.O.’s projections as a justification for approving additional aid.

Nevertheless, the report draws attention to the amount of money the United States borrows to finance all of its spending. The Budget Office now expects total federal debt to be 105 percent of the size of the economy by 2030, down slightly from its September forecast of 109 percent. Last year, the recession pandemic pushed up the country’s total debt to more than the economic output and trillions of dollars in federal spending to fight the recession.

Budget Office officials said another set of reports released Thursday afternoon will show that several federal trust funds, including those for Social Security and the country’s highways, are now expected to remain solvent for years longer than the separation scheduled for September.

The report also predicts that the deficit will briefly fall below $1 trillion in fiscal years 2023 and 2024, before rising again in the second half of the decade. From 2021 to 2031, the deficit is expected to average $1.2 trillion per year.

A nurse updates patient information this week at Santa Maria Hospital in Santa Maria, Calif. Healthcare is one of the sectors where the number of new hires has increased. credit Daniel Dreifuss for the New York Times.

Wanted: Caregivers, delivery people and technology specialists.

Although the labor market is growing at a sluggish pace, employers are sounding the alarm in some areas, according to economists at two of the largest online job search portals, ZipRecruiter and Indeed.

There are clear differences between industries, explains Julia Pollack, labor economist at ZipRecruiter.

In addition to the strengths of industries benefiting from the trend to stay at home, such as B. warehousing and shipping, there are recent signs of new hiring in the technology, professional and business services sectors.

The company is forward-looking and somewhat optimistic, Pollack said.

AnnElizabeth Konkel, an economist at Indeed Hiring Lab, added that demand for pharmacists was up 23% from the previous year, while the number of vacancies for drivers was up 18%. All of these elements are directly related to the pandemic, Konkel said.

However, there are significant regional differences in recruitment. In cities where many people work remotely, such as. B. In Washington, DC, Seattle, Boston, and San Francisco, there were fewer ads in some areas than in areas with more people in the office.

People don’t stop at the local coffee shop on their way to work or stop in the store to buy something when they work from home, Konkel said, and that affects hiring.

She added that employment in restaurants was down from last year, as was employment in the arts and entertainment, hospitality and tourism sectors.

At ZipRecruiter, the energy industry has seen an increase in job openings after the dramatic losses due to the pandemic. In addition, other wells have recently gone into production.

Some of the losers are finally coming back, Pollack said. But many industries cannot resume operations during the pandemic.

Bloomberg L.P., the parent company of Bloomberg News, makes most of its money from expensive subscriptions to its terminal operations. Credit… Marcus Yam for The New York Times.

Bloomberg News, the financial information giant founded by billionaire Michael R. Bloomberg, will lay off dozens of employees as it restructures its newsroom.

Bloomberg editor John Micklethwait announced the changes in a memo sent to employees Thursday. He said the editors were losing stories because we were too slow and needed to be more responsible. The memo was seen by The New York Times.

Teams waited for someone to reread an article or ignored requests from the editorial team for a quick response, he said, referring to the editorial term for taking over an article or news item. Too much time was spent on conference calls when all they should have been doing was writing.

Mr. Micklethwaite wrote that the reorganization of the newsroom will result in layoffs. The company will cut about 90 jobs in newsrooms worldwide, according to a person with knowledge of the matter. Most of those who will lose their jobs will be editors, said the person who asked not to be identified because the information is not public.

This is not a gesture we take lightly, Mr. Micklethwaite wrote. But we’ve always tried to improve the newsroom, make us more nimble, improve our content and help us cover capitalism more fully.

He said the new system would mean that in future most editors would report to editors, who would assign them to individual stories and get rid of unnecessary rereading or re-editing.

Micklethwaite said that despite the layoffs, the company is looking to recruit in priority areas such as data journalism and plans to end the year with the same number of journalists as before the pandemic.

Bloomberg News is one of the world’s largest news organizations, with more than 3,100 editors and researchers. In many ways, this helped prevent the massive layoffs that hit the media sector last year. Bloomberg L.P., the parent company, has about 20,000 employees.

Bloomberg L.P. makes most of its money from expensive subscriptions at its terminal operations, but Axios said this week that Bloomberg Media expects to bring in at least $100 million in revenue from consumer digital subscriptions this year.

Microsoft’s call for Internet regulation is the latest example of a rift in the technology industry, which is coming under increasing scrutiny. Credit…Carlo Allegri/Reuther

On Thursday, Microsoft called on the United States to pass competition laws that would force technology platforms like Facebook and Google to share more revenue with news publishers, drawing a clearer line between Microsoft and the technology giants that oppose the idea.

Brad Smith, president of Microsoft, said technology companies need to do more to support independent journalism. He said some executives were motivated to speak out because of the misinformation surrounding the U.S. election and the decline of news organizations over the past two decades.

To illustrate the kind of legislation the company has in mind, he referred to bills in Australia that would require newspaper publishers to jointly negotiate higher prices with digital platforms.

Publishers have nowhere else to go, so at the end of the day they are forced to accept leftovers on the table without compensation for producing much of the food on the other side of the table, Smith said in an interview.

Microsoft’s call to regulate the Internet is the latest example of a rift in the technology sector at a time when it is under increasing scrutiny. Google and Facebook have vehemently opposed the Australian proposal, threatening to shut down all or part of their services in the country if the disclosure law goes into effect. Salesforce.com, Apple and IBM are pushing for regulation of the business models of Facebook and Google, which make user data available for advertising.

Bills have already been introduced in the Senate and House of Representatives to help newspaper publishers collectively negotiate the cost of publishing their content on platforms like Google and Facebook. The coordination would likely violate antitrust laws against collusion, but lawmakers are asking for an exception for the local news emergency, in which 2,000 news organizations have closed since 2000.

Smith said he and Microsoft CEO Satya Nadella recently called Australian Prime Minister Scott Morrison and welcomed the proposed competition law for internet platforms as an important effort to support journalism. They added that even if Google leaves the country, Microsoft will not. Microsoft’s search engine Bing also features news from Australia.

The technology sector is not a monolith, Smith said.

related to Carlo Allegri/Reuters credit.

Kenneth C. Griffin, a billionaire hedge fund manager, may be one of the executives who will testify next week at a Congressional hearing on the recent stock market frenzy at GameStop, which has angered many big investors, according to the man familiar with the matter.

Citadel, Mr. Griffin’s company, is a central player in the GameStop drama, both through its investments and the role of its sister company, Citadel Securities, as a market maker in the stock market. The man said he has been asked to designate a manager for a February 18 hearing scheduled by the House Financial Services Committee, but the company is still waiting to hear whether the committee will call Griffin or another manager.

Reddit CEO Steve Huffman said Thursday that the social network also plans to participate. Many small GameStop investors gathered on the Reddit WallStreetBets bulletin board to have fun placing their bets last month.

Citadel told the committee that Joseph Mecane, a senior executive at Citadel Securities
who oversees trading services for companies like Robinhood, may replace him, the person said. Citadel Securities is separate from the hedge fund and was also founded by Mr. Griffin.

A House representative did not respond to requests for comment. California Representative Maxine Waters, who chairs the committee, said she wanted Vlad Tenyev, Robinhold’s chief executive, to testify at the hearing.

She also stated that she was considering asking the hedge fund Melvin Capital to testify.
Hedge fund Citadel and a group of partners invested $2 billion in Melvin after he took huge losses betting that GameStop shares – which soared from less than $100 to nearly $500 in just a few days – would fall.

Due in part to betting against GameStop, Melvin ended January down more than 53%, the New York Times reported at the beginning of the month, while Citadel, which also bet against GameStop on its rise, ended the month down 3%.

Mr. Griffin also participated in the GameStop rally through Citadel Securities. Robinhood, the free online trading company that handles much of GameStop’s business through amateur investors, makes money by sending buy and sell orders to Citadel Securities, which pays Robinhood for the order flow.

A design for a new $20 bill produced by the Bureau of Engraving and Printing, with Harriet Tubman.

Efforts to make Harriet Tubman the face of the $20 bill received a bipartisan boost this week when two senators asked Treasury Secretary Janet L. Yellen to prioritize a planned overhaul that had stalled during the Trump administration.

This week, Senator Jeanne Shaheen, a Democrat from New Hampshire, and Senator Ben Sasse, a Republican from Nebraska, sent a letter to Yellen emphasizing that the U.S. currency should reflect the country’s diversity. They complained that a 2016 Obama administration plan to unveil a $20 bill design in 2020 with Tubman in the foreground was not followed by former Treasury Secretary Steven Mnuchin.

We sincerely hope this will not happen again, and we urge Ms. Tubman to prioritize this issue before moving forward with the redraft, they wrote. We stand ready to support your efforts, in any way, to ensure that this dominant figure in our nation’s history receives the recognition she has so long deserved.

Last month, the Biden administration said Yellen would explore ways to speed up the process of adding Harriet Tubman’s portrait on the cover of the $20 bill.

It’s important that our money reflects the history and diversity of our country, said Jen Psaki, White House press secretary.

A Treasury spokesman did not respond to a request for comment about whether the Bureau of Engraving and Printing, which oversees that department, took over the redesign involving Dr. Tubman.

Work on the redesign began under the supervision of former Treasury Secretary Jacob Lew, but Mnuchin said strengthening the security features of the new memos takes precedence over changes to the visual language. Mr Trump has already spoken out against the idea of replacing President Andrew Jackson, a populist, with Ms Tubman, a former slave and abolitionist.

The Steering Committee to Strengthen Counterfeit Enforcement Measures has developed plans to reissue the $10 and $5 bills, which will be upgraded to $20 in 2013.

Ms. Shaheen and several Democrats in the House were strong supporters of the initiative to replace Mr. Jackson with Ms. Jackson. Tubman as the face of $20. Few Republican lawmakers have publicly expressed support for these changes.

A prototype Learjet 23 business jet during a test flight in 1964. Credit…Halton Archive/Getty Images Archive

The luxurious Learjet, made famous by Frank Sinatra and immortalized in the songs of Pink Floyd and Carly Simon, takes flight.

Bombardier, the Canadian company that makes the plane, said Thursday that it would stop building the aircraft by the end of the year – more than half a century after its introduction – as it focuses on its larger, more profitable Challenger and Global jets. The decision comes after Bombardier stopped producing airliners last year and last month completed the sale of its rail division, as part of an effort to return to profitability by focusing more on private jets.

With the completion of our strategic repositioning, we look forward to beginning our journey as a pure business aviation company, said Eric Martel, CEO of Bombardier.

The company also announced plans to cut 1,600 jobs, or about 10% of its workforce. Bombardier said Thursday that it lost $568 million last year and hopes to cut costs by more than $400 million by 2023.

Learjet’s decision came just months after the company announced the first delivery of its newest aircraft, the Learjet 75 Liberty.

The aircraft was originally designed by William Lear, an engineer, with an emphasis on performance. It entered service in 1963 and played an important role in ushering in the era of luxury private aviation. Sinatra reportedly bought it in 1965 and used it to travel to and from Las Vegas, making it an unparalleled symbol of luxury for the rich and powerful.

More than 3,000 Learjets have been sold since its inception. But the plane has faced difficulties in recent years as private jet buyers have found it too cramped and less luxurious than other aircraft. Bombardier, which acquired the Learjet business in 1990, delivered only 11 units to its customers last year.

Maura Healey, Massachusetts attorney general, sued the Pennsylvania Higher Education Support Agency in 2017…. Stephen Senne/Presse Associée

One of the country’s largest student loan lenders and the Massachusetts Attorney General have agreed to settle a lawsuit over errors that the state says harmed thousands of public officials who tried to take advantage of the federal loan forgiveness program.

The lender, the Pennsylvania Higher Education Assistance Agency, trading as FedLoan, will review the account of any Massachusetts resident requesting a recall. The company will correct the errors identified and pay compensation to borrowers who have suffered financial loss.

This agreement provides support for teachers and other public sector employees for the first time, said Maura Healey, state attorney general, in a statement. Government employees burdened with student loan debt are entitled to the debt forgiveness promised to them under these federal programs.

In 2017, Ms. Healey’s office filed a lawsuit against the Pennsylvania Higher Education Assistance Agency, accusing it of making errors in calculating borrower payments, overbilling some borrowers, and mishandling income reimbursement plan requests.

According to the complaint, this affected in particular those who were beneficiaries of the government’s public service loan forgiveness programme. The loan company has an exclusive contract with the federal government to manage the accounts of those who wish to take advantage of the program, which has been widely criticized for its messy implementation and egregious errors.

According to Healey, more than 200,000 Massachusetts residents may ask for a review of the law. The settlement was approved Tuesday by a Superior Court judge.

Keith New, a spokesman for the company, said the agreement reaffirms P.H.E.A.’s commitment to all student loan borrowers and the high quality of P.H.E.A.’s customer service in managing their student debt.

Most public borrowers whose loan forgiveness requests have been denied are automatically flagged for review, which the company must complete within 120 days according to the regulations. This is much faster than the year – or more – the company spent on some borrowers telling them that an examination of their claims was necessary.

The company is being sued in federal court by the New York Attorney General, who is filing a criminal complaint in 2019. Last year, a federal judge rejected the company’s motion to dismiss.

WarnerMedia will expand its streaming platform HBO Max beyond the United States this summer. The company, which unveiled its streaming service in May and ended the year with 17.17 million active users, said Thursday that HBO Max will be available in 39 Latin American and Caribbean territories in June.

By combining HBO with WarnerMedia’s best series and film catalog, as well as local content from master storytellers in Latin America, HBO Max will provide fans in the region with an unforgettable and rewarding entertainment experience, said Johannes Larscher, director of HBO Max International.

As in the United States, WarnerMedia will give existing HBO GO customers immediate access to HBO Max and will phase out the HBO GO service.

WarnerMedia gave HBO Max a boost – and shocked some in Hollywood – by announcing in November that all Warner Bros. films would be released simultaneously in theaters and on the streaming service by 2021. The initiative took effect in 2020; Wonder Woman 1984 began on Christmas Day and helped bring the total number of subscribers to HBO and HBO Max to 41 million, two years ahead of our original projections, said John Stankey, CEO of AT&T, WarnerMedia’s parent company.

The company also announced that its streaming service under the HBO brand will make its European debut later this year.

The pound sterling recorded a quiet rise. The currency crossed the $1.38 mark this week, a level it had not reached against the U.S. dollar in nearly three years, and is up nearly 2% against the euro this year. Britain is under lock and key, but its trade deal with the European Union and the rapid introduction of vaccines have helped the good performance of the country’s financial assets, including stocks.

It was raised last week after the Bank of England painted an optimistic picture of this year’s economic recovery once the blockade was lifted. It predicts that the UK economy will return to its pre-crisis size by early 2022.

The central bank also stated that it has no intention of introducing negative interest rates in the near future, which would increase yields on the pound and bonds.

However, the rise of the pound could face hurdles. The Brexit trade deal has created a number of obstacles as exporters face new customs rules and retailers rethink their supply chains. Tensions between London and Brussels appear to have increased over the future of Northern Ireland’s financial services and trading arrangements.

Despite the relief in the market that the UK and US were able to agree on a trade deal in December, it is clear that Brexit is casting long shadows, writes Jane Foley, monetary strategist at Rabobank, in a note.

Looking ahead, we still see headwinds, both political and economic, for sterling and we expect a rather bumpy ride in the coming months, she said, using sterling as an abbreviation.

Elsewhere on markets

  • The stock market indexes on Wall Street rose, with the S&P 500 gaining about 0.2%.
  • Pinterest shares were up more than 7%. The Financial Times reported last Wednesday that Microsoft has moved closer to purchasing the social media company in recent months, but that no negotiations are underway.
  • Shares in Europe posted mixed results. The Stoxx Europe 600 gained about 0.4%.
  • ArcelorMittal, the world’s largest steel company, said Thursday that Aditya Mittal, the company’s president and chief financial officer, will succeed his father Lakshmi Mittal as CEO. Lakshmi Mittal, who founded the company, will be the executive chairman. In a phone interview with reporters, Aditya Mittal said he wanted to focus on reducing carbon dioxide emissions in steel production.

frequently asked questions

What will the national debt be in 2021?

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Is there a federal budget for 2021?

The U.S. federal budget for fiscal year 2021 is 1. October 2020 through the 30th. September 2021. … The fiscal year 2021 budget resolution began in February 2021 with the passage of the COWID-19 Pandemic Assistance Act as part of the budget deliberations.

What is the current federal budget deficit through 2020?

The federal government’s deficit for fiscal year 2020 is $3.1 trillion, more than triple the deficit for fiscal year 2019. This year the deficit was 15.2% of GDP, the largest deficit in the economy since 1945.

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